Thursday, March 31, 2016

U.S. Drops Apple Case After Getting Into Terrorist’s iPhone

  • Prosecutor vows `solemn commitment' to Dec. 2 shooting victims
  • Decision to avoid long legal battle marks victory for company

The U.S. said it has gained access to the data on an iPhone used by a terrorist and no longer needs Apple Inc.’s assistance, marking an end to a legal clash that was poised to redraw boundaries between personal privacy and national security in the mobile Internet age.

The Justice Department said a week ago that it was approached by an unidentified third party about a possible method to get into the phone. The government said in a court filing Monday that it “has now successfully accessed the data stored” on the iPhone 5c used by Syed Rizwan Farook, who with his wife carried out a December attack in San Bernardino, California. No details were provided on how investigators got the data.

The Justice Department was fighting Apple in an unprecedented court showdown when it abruptly asked last week to cancel a hearing before a federal magistrate judge over her order directing the company to help investigators get into the phone.

The decision to drop a legal battle that could have gone all the way to the U.S. Supreme Court marks a win for Apple. The Cupertino, California-based company resisted being forced to write new software that would make it easier for the FBI to break into the shooter’s phone. Chief Executive Officer Tim Cook said such a move would pose a threat to the privacy of hundreds of millions of iPhone users around the world, arguing that a backdoor of that nature could be exploited by less reputable parties.

While Apple has emerged victorious from the court tussle, the government’s claim that the FBI was able to hack the phone with the help of a third party tarnishes the iPhone’s purported security prowess. Monday’s filing signals that government agencies can break into phones with encryption systems that were designed to make them impenetrable.

Third Party

The FBI was able to unlock the iPhone over the weekend without compromising the data stored on it using the method provided by the third party, according to a U.S. law enforcement official.

Investigators are currently reviewing the information obtained from the phone, said the official who spoke to reporters on the condition of being anonymous. The official declined to provide any details, such as what was on the phone, the identity of the third party or how the method worked. The official also declined to say whether the U.S. will give Apple details about the hacking method.

“Our decision to conclude the litigation was based solely on the fact that, with the recent assistance of a third party, we are now able to unlock that iPhone without compromising any information on the phone,” Eileen Decker, the U.S. attorney in Los Angeles, said in a statement. “We sought an order compelling Apple to help unlock the phone to fulfill a solemn commitment to the victims of the San Bernardino shooting – that we will not rest until we have fully pursued every investigative lead related to the vicious attack.”

Apple said the court case never should have been brought.

“We will continue to help law enforcement with their investigations, as we have done all along, and we will continue to increase the security of our products as the threats and attacks on our data become more frequent and more sophisticated,” the company said in a statement. “Apple believes deeply that people in the United States and around the world deserve data protection, security and privacy. Sacrificing one for the other only puts people and countries at greater risk.”

Future Cases

The U.S. may have a harder time going back to court in future cases where it requires a company to cooperate with a similar investigation because, after first telling the judge only Apple could help unlock the phone, the government has come back a month later saying it doesn’t need Apple’s help after all, according to Victoria Schwartz, an associate law professor at Pepperdine University in Malibu, California.

“It looks like the government cried wolf," Schwartz said in a phone interview. “Next time, a court may take a more careful look at their request for a similar order.”

While the Justice Department repeatedly argued that a court ruling in the California case would only help it access the individual iPhone 5c affected, other technology companies from Facebook Inc. to Yahoo! Inc. rallied behind Apple’s claim that the matter could set a precedent which would allow other law enforcement agencies a backdoor into handsets. 

In an effort to undermine Apple’s argument that the software could be abused by authoritarian regimes, Department of Justice lawyers had highlighted the thousands of times the company helped China access data last year. Nonetheless, Apple has disclosed that U.S. authorities targeted twice as many devices in similar instances.

IOS Vulnerabilities
Apple regularly finds vulnerabilities in its iOS mobile software that it remedies with each new update. Such an upgrade was rolled out last week, including the fixing of a flaw found by two researchers at security consultancy Inverse Path. The Trieste, Italy-based company told Bloomberg News it might theoretically be possible to use the vulnerability, which could be accessed via the USB drive, to modify a phone’s software and bypass security measures.

Several researchers had also outlined how so-called NAND mirroring might be used to break into the phone. In that method, the FBI could copy the hard drive contents onto a separate drive, then should incorrect password combinations prompt the security measures to wipe the drive, the agency could reinstall them and try again.

Federal Bureau of Investigation Director James Comey said last week that the government wasn’t using the latter method, and the agency has declined to outline exactly how it was working to break into the phone. Apple lawyers said before Monday’s announcement that they expect the FBI to explain any successful method it discovers.

Brooklyn Phone

The government has not yet said whether it will pursue a similar fight in Brooklyn, New York, where authorities are trying to crack Apple’s encryption on a drug dealer’s phone. Apple won a first round of the dispute in February, and the U.S. has asked that the ruling be reversed. The San Bernardino case involves a newer operating system -- iOS 9 -- as compared with the iOS 7 device in Brooklyn.

On Tuesday, the government agreed to go along with Apple’s request for more time to respond to a renewed U.S. application for an order compelling the company to help in unlocking the iPhone in Brooklyn.

Apple had sought an extension to April 15 to respond to the government’s request, saying it didn’t have enough information to determine the best way to proceed.

Legally, the question remains open whether the government can force a private 
corporation to write code to help with an investigation, said Schwartz, the law professor

“This issue is not going to go away,” Schwartz said.

The case is In the Matter of the Search of an Apple iPhone Seized During the Execution of a Search Warrant on a Black Lexus IS300, California License Plate 35KGD203, 16-00010, U.S. District Court, Central District of California (Riverside).

Meet the Real-Life Tech Wizards of Middle Earth (BW()

Episode 1: New Zealand’s freaky AI babies, robot exoskeletons, and a virtual you.

If you’re asked to travel to New Zealand to interview people about the country’s technology scene, prepare to hear about one thing over and over again: No. 8 wire.

In the 19th century, farmers used the wire—with its .16" diameter gauge—to build fences for sheep. The wire, though, took on far many more purposes than fencing in sheep. Farmers solved many of the pressing problems on their property by contorting and repurposing the wire. They turned it into a jack-of-all-trades material for getting work done, the duct tape of rural New Zealand.

Over the decades, No. 8 wire became a broader metaphor for the New Zealand spirit. It spoke to a people who lived far apart from the rest of the world and each other and had to be independent and resourceful. New Zealanders took to priding themselves on their ability to solve problems in unconventional, sometimes crude ways.

Weta Digital MoCap actor gets captured for VR filming at their studio.

No. 8 wire culture is still strong. But this country of 4.5 million people has started to churn out some awfully polished, extraordinary products. These are not the things of people doing their best to get by with what they have on hand. They’re world-class technological achievements—the work of a well-educated, creative people bent on competing on the world stage. Improvisation has given way to a much more methodical, ambitious form of invention.

This episode of Hello World offers a window into just how good New Zealand technology has become. My journey covers much of the country’s North Island, stretching from Auckland to the southern port and capital of Wellington. There’s a road trip in between; if you’re going to New Zealand just to see people in labs and office parks, you’re missing out on one of the most beautiful countries on the planet. Mountains, beaches, deserts, grassy hills, rainforests—it’s all there.

As for the technology, well, bless the New Zealanders and their willingness to go after seemingly daft—some would argue impossible—ideas. Just in Auckland, there’s a professor named Mark Sagar who has built the world’s most realistic computer-generated faces, making them think and talk, too. There’s Rex Bionics, which has made exoskeletons that let paralyzed people walk again. There’s a gentleman named Ray Avery, who wears all-white and creates low-cost baby incubators and protein formulas for the malnourished from his garage lab. And there’s Rocket Lab—an honest-to-God rocket company that is on the verge of lowering the cost of sending things to space by the most dramatic margin in history. It tests these rockets near a farm on the outskirts of Auckland, and the cows and sheep barely seem to mind.

The technological action in Wellington impresses as much, although it comes with a much different bent. This is the home of Peter Jackson’s moviemaking empire, and it's an incredible hotbed of effects artistry in two, three, and four dimensions.

When Jackson started the Lord of the Rings project, most people figured he would do the movies and then Wellington would more or less go back to its roots as the center of the country’s government. But Jackson has hopped from one grand project to the next, building a moviemaking industry that continues to attract work and talent from overseas. There are film sets, supercomputers for special effects, and enormous virtual reality studios. And if you happen to be the host of a technology travel show, you get to play with all the toys, including Jackson’s bespoke camera.

Jackson started Weta Digital, which has morphed from a pure film operation to a quasi-tech startup. They’re building some groundbreaking software for manipulating images, and this might turn into a stand-alone virtual reality technology company.

Talent from Weta and from Jackson’s other companies have gone on to start companies, too, usually in the technology field. There’s 8i, for example, which uses dozens of standard cameras to capture a 360-degree video of a person and turn it into a virtual reality character. These are early days for the technology, but its implications are profound. If someone is willing to have all those cameras, a few computer geeks, and a green screen in a hospital room, the birth of a child can be captured and forever relived, just by donning a face computer. My wife and I missed our opportunity to share that experience, but—thanks to a visit with 8i—I now have a version of my 38-year-old self to talk to when I’m lonely.

There’s a sense of urgency behind all of this technological activity. New Zealand’s economy depends so much on agriculture and tourism. It’s clear that New Zealand has moved well beyond the days of No. 8 wire-tinkerers making microwaves in their workshops out of fencing and discarded toothpaste tubes. The country seems determined to dazzle outsiders with well-made, very clever technology.

Follow Ashlee Vance's Hello World travels

Monday, March 28, 2016

Is Tay, Microsoft’s Chatbot, Really a Bad Naughty Robot? (Shelly Palmer)


Tay is a combination chatbot and AI system designed by Microsoft to “engage and entertain people where they connect with each other online through casual and playful conversation.” It was specifically “targeted at 18 to 24 year olds in the U.S., the dominant users of mobile social chat services in the U.S.” If the words “designed” and “targeted” are off-putting, then you’re really not going to care for one of the system’s recent, now infamous, tweets:
Taytweet censored

The media have been all over this story, and most of the headlines are sensationalist, to say the least. Just Google “Tay,” and the results speak for themselves. That said, Microsoft has apologized and now it’s time to learn from the experience.

Let’s Not Conflate AI and Chatbots

In 1952 Arthur Samuel began to teach a computer to play checkers, thinking that it was a good model for rudimentary problem solving.  He defined AI (known back then as “machine learning”) as “a field of study that gives computers the ability to learn without being explicitly programmed.”

Arthur Samuel
Arthur Samuel playing his computer checkers game
We can benefit from this definition, but first we must define the verb “to learn.”  When Arthur Samuel used the term “to learn” it was not cognitive; it was operational. Today, systems like Google’s AlphaGo are starting to do work we (humans) would describe as cognitive. Right after AlphaGo beat 9-dan Go master Lee Sedol, I wrote an essay about the potential impact of AI on human cognitive work entitled, “AlphaGo vs. You: Not a Fair Fight.” It will, and should, scare you.

Chatbots, on the other hand, can be as simple as order-taking algorithms. They can be purely operational and still be amazingly effective. For example, Fandango’s chatbot may text you about the availability of movie tickets, but the system does not need any AI to process your request to purchase them. And while there are thousands of entertaining chatbots available online, they are mostly parlor tricks created for your amusement, nothing more.

Microsoft’s Tay is a combination of these two ideas. It’s an AI-powered chatbot. Among its other capabilities, for its debut, it was supposed to “engage and entertain” people by anthropomorphically interacting with them on Twitter.

Microsoft’s Mistake

According to Microsoft, the company had a great experience in China with its Xiaolce chatbot. They claim the system delighted approximately 40 million people with its stories and conversations. “The great experience with XiaoIce led us to wonder: Would an AI like this be just as captivating in a radically different cultural environment? Tay – a chatbot created for 18- to 24-year-olds in the U.S. for entertainment purposes – is our first attempt to answer this question.” Oops! 
China is not America and the cultures of the two countries could not be more different.

This is not the first time engineers have failed at “engineering” social interactions. Anyone remember Google Buzz? But I digress. Microsoft’s biggest mistake was not an engineering oversight; it was expectation management. No matter how rigorously you test an AI system, it will always perform differently in the wild. 

There are just too many variables. But Microsoft could have mitigated much of the risk by simply managing user expectations. Was Tay a consumer product? Was it a demonstration of some aspect of AI or data-scientific research? Was it a tour de force in question answering technology? All Microsoft told us was that “Tay has been built by mining relevant public data and by using AI and editorial developed by a staff including improvisational comedians. Public data that’s been anonymized is Tay’s primary data source. That data has been modeled, cleaned and filtered by the team developing Tay.” What should we have expected from Tay?

“I’m Such a Bad Naughty Robot”

Tay’s tweet, which is only one of a whole bunch of seriously inappropriate missives spewed by the system, is not its fault. Tay is doing what it was programmed to do and, clearly, the model needs some adjustments. However, Microsoft did not do what it was supposed to do. As responsible engineers, they should have stated the scientific principles they were exploring, described the methodology, set specific levels of expectations and, most importantly, been ready for prime time before launching. Deep Blue did it with chess. Watson did it with Jeopardy! and AlphaGo did it with Go. Sadly, Tay was no match for a bunch of American 18- to 24-year-olds – because when you “target” people (especially Millennials), they will absolutely “target” you back.

The Future Is AI-Powered Chatbots and Everything Else

Here’s the most important take-away from Microsoft’s experience with Tay: They may have stumbled out of the gate, but the future is AI-Powered Chatbots. This technology is going to dramatically change how and when you use Apps. It will completely change how you interact with the Web and the Internet of Things, and seriously impact almost every form of electronic communication. Cognitive chatbots will displace millions of customer service representatives, millions of paper-pushers and millions of other low-paying jobs in the very near future. If you make under $40/hour in the US and you do not perform manual labor, AI and the associated toolsets will absolutely replace you sooner than later. Laugh about this “bad naughty robot” all you want – it’s not funny.

Friday, March 25, 2016

How Tesla's Model 3 Could Conquer Low-End Luxury (BW)

Here's what it looks like if Tesla can replicate its Model S dominance with the Model 3.

What happens when the price of electric cars falls lower than the gasoline-powered competition? That's the question Tesla Motors Inc. wants to answer with its Model 3, which will carry a $35,000 price tag at its unveiling on March 31. But we don't need to wait until the Model 3 goes on sale, because Tesla already has an inexpensive electric vehicle to learn from: the Model S. 

Sure, you might not think of a $70,000 sedan as cheap. The sticker price doesn't even even include the thousands in add-ons purchased by most Tesla shoppers. But within the class of competitors—premium, large-sized luxury vehicles—the Model S is a bargain. It's faster, safer, and by many measures more convenient than its fancy, gas-chugging peers. In less than four years it has become the top-selling large-luxury vehicle in the U.S., already outselling high-end options from Mercedes-Benz, BMW, and Audi. 

The Model 3 is designed to replicate this success in a much bigger class of car: entry-level luxury (also known in the industry as "compact executive" or "small luxury"). This group is currently led by the BMW 3 Series and the Mercedes-Benz C-Class. Elon Musk, Tesla's chief executive officer, has compared the Model 3 in size to the Audi A4, a five-seat sedan with a roomier feel than those of some compact peers. For the newest Tesla to dominate entry-level luxury by the same margin held by the Model S in large luxury, it would mean sales of almost 170,000 a year in the U.S.  

Analysts have been skeptical about the rollout of next-generation electric cars amid the long slump in oil prices that started in 2014. U.S. gasoline prices have held below $2 a gallon for all of 2016, and the rebound to higher prices is expected to be long and slow. That could substantially reduce demand for electric cars that compete with such mass-market compact cars as the Ford Focus, Chevy Cruz, and Honda Civic—all costing less than $22,000 and enjoying annual U.S. sales of more than 200,000 per year. 

But in the entry-level luxury market, cheap gasoline shouldn't be much of an obstacle. The Model 3 will be one of the most affordable cars in the class, even before accounting for government incentives for purchasing electric cars and savings on gasoline. If the $35,000 Model 3 retains some of the performance and design thrills that have become Tesla's trademark, gasoline savings will be just another perk for the brochure. We'll soon know more. 

The Model S sedan redefined electric cars for the American consumer. The car rockets from 0 to 60 miles per hour in as little as 2.6 seconds—faster than most of the world's priciest supercars, including Lamborghinis, Ferraris, Porsches, and McLarens. With no engine up front, it has a huge crumple zone and the highest safety ratings of any car on the road. Its all-electric range approaching 300 miles per charge means most drivers never need to power up outside their own garages. There's also the possibility that Tesla's industry-leading autopilot features will be extended to the masses in the Model 3.

The Model 3 will be unveiled at Tesla's design studio in Hawthorne, Calif., on March 31. The first deliveries are scheduled for next year. 

Thursday, March 24, 2016

BMW, Audi and Toyota cars can be unlocked and started with hacked radios

BMW 7-series
The affected cars include BMW's 730d, as well as models from Audi, Honda, Ford and Toyota

Dozens of car models, including BMW, Audi and Range Rover can be remotely unlocked and started using a simple hack, research reveals. 

The hack allows malicious actors to unlock and drive away 24 different car models from 19 manufacturers using a cheap and easily constructed radio amplifier. Called the "amplifier attack", the hack involves altering the radio frequency in the cars to trick the keyless sensor technology into thinking that the vehicle's owner is nearby with the key. 

The cars affected include European popular models such as the Ford's Galaxy, Audi's A3, Toyota's Rav4, Volkswagen's Golf GTD and Nissan's Leaf. This isn't an untested threat either, the researchers claim the method has already been used in car thefts, and is evidenced in real surveillance footage.  

The researchers believe dozens more models that use keyless technology could be vulnerable, but they are yet to prove it. Currently, 95 per cent of European car brands use keyless entry. 

The only car that resisted the researchers couldn't unlock was BMW's i3. But they were able to start its ignition. And the BMW 730d was hackable, meaning that the German carmaker's models aren't immune to the vulnerability. 

Self-driving cars can be hacked using a laser pointer

Self-driving cars are a huge area of research and investment in the UK, with the market estimated to be worth £900bn by 2025, but a security researcher has uncovered a way to hack these vehicles using nothing but an off-the-shelf laser pointer, highlighting the possible risks associated with the new technology.

Jonathan Petit, principal scientist at software security company Security Innovation, discovered that a laser pointer could interfere with the laser ranging (Lidar) systems that most self-driving cars rely on to navigate. The Lidar system creates a 3D map and allow the car to 'see' potential hazards by bouncing a laser beam off obstacles.

Screenshot of what the car sees when turning right

Shining the laser pointer at a self-driving car so that it is picked up by the Lidar system could trick the car into thinking something is directly ahead of it, thus forcing it to slow down. Alternatively, a hacker could overwhelm it with spurious signals, forcing the car to remain stationary for fear of hitting phantom obstacles.

Mr Petit described the so-called 'proof-of-concept' attack in a paper written while he was a research fellow in the University of Cork’s Computer Security Group, entitled Potential Cyberattacks on Automated Vehicles. The paper will be presented at the Black Hat Europe security conference in November.

During tests, Mr Petit was able to trick the sensors into seeing 'ghost' vehicles or pedestrians from a distance of 330ft (100m), using a low-power laser and a pulse generator. However, he said the the pulse generator was not strictly necessary – the same attack could be carried out using a Raspberry Pi or an Arduino single-board computer.

Mr Petit added that there are ways to mitigate the risks: “A strong system that does misbehaviour detection could cross-check with other data and filter out those that aren’t plausible. But I don’t think carmakers have done it yet. This might be a good wake-up call for them,” he told IEEE Spectrum.

This is not the first time the risks associated with driverless cars have been highlighted. In 2013, researchers at the University of California and University of Washington found ways to infect driverless vehicles with computer viruses and cause them to crash by shutting off their lights, killing their engines or slamming on their brakes.

Hackers also recently took remote control of a Jeep Cherokee, by breaking into its dashboard computer, killing the engine, applying the brakes and crashing it into a ditch. The US hackers said they used just a laptop and mobile phone to access the Jeep's on-board systems via a wireless Internet connection.

A report from the Institution of Engineering and Technology (IET) published in November 2014 warned that driverless cars are vulnerable to hackers because of the high level of computer technology on board. It said that hackers could bring cities to a standstill, steal cars remotely or even commit deadly terror attacks.

“If we have the hacker community start to target vehicles in Central London we could imagine a fair amount of chaos on the roads," said Hugh Boyes, a cyber-security expert at the IET, at the time. “Terrorism is a real risk. So cyber-security of autonomous vehicles will be critical. And we're going to have to consider having black boxes in vehicles in the event of an incident."

Wednesday, March 23, 2016

Intel's Andy Grove: Champion of diversity and corporate governance

Over the past 15 years Andy Grove worked tirelessly to make Intel into a model of corporate governance with a diverse board and the  appointment 
of senior female execs.

Intel yesterday announced that Andrew Grove, its former CEO and Chairman, had died aged 79.

I met several times with Andy Grove when I worked at the Financial Times and became a great admirer of his work at Intel. I saw him for the last time in September 2015, at a Churchill Club event honoring his long career and contributions to Silicon Valley. Grove was looking very frail and his Parkinson's Disease was very pronounced.
While much has been written about his time at Intel and his rise to the CEO and Chairman positions, very few know about his work over the past 15 years in remaking Intel into a model of corporate governance and improving diversity inside Intel.
He remade Intel's board of directors, making sure it was truly independent, and packed with diversity. Grove's influence is seen in Intel's separation of CEO, President and Chairman positions -- which is atypical in tech companies.
His goal was to build a world-class advisory group for the CEO, and a strong belief that great corporate governance would yield good things for Intel's shareholders. It's an investment for which Intel has yet to receive a boost in valuation from Wall Street.
Intel's board of directors earned a perfect score from GovernanceMetrics International. Only 21 other company boards have received this recognition.
Grove's influence and focus on diversity led to the appointment in May 2013 of Renée James as President, essentially a co-CEO position with Brian Krzanich. Ms. James worked as Technical Assistant (TA) to Mr Grove for four years -- a traditional fast-track path for senior Intel execs. She left Intel in January 2016.
Andy Grove's legacy is immense and his influence in Silicon Valley and beyond has been extraordinary.
Tom Foremski for Tom Foremski: IMHO |

Tuesday, March 22, 2016

Apple Unveils Smaller-Screened iPhone SE to Jump-Start Sales

  • Cook on FBI fight: `We will not shrink from responsibility'
  • Newest phone, aimed at emerging markets, will arrive March 31

Apple Inc. unveiled a new, smaller iPhone that will start at $399, seeking to jump-start sales of its flagship product by enticing more users to upgrade, especially in high-growth markets such as China and India.

The iPhone SE has a 4-inch-screen, comes in four stainless-steel finishes, and incorporates the faster A9 processor that also runs the larger iPhone 6S handsets, Apple Vice President Greg Joswiak said at an event Monday at the company’s Cupertino, California, headquarters. Apple also showed off a new iPad, incorporating the power and some features of its larger Pro model for business users, and cut the price of its year-old Apple Watch.

The revamped compact iPhone arrives two months after Apple said quarterly sales will probably decline for the first time since 2003, heightening concern that demand for high-end smartphones has reached its peak. Customers’ eagerness to freshen their handsets regularly has waned in the past two years, and the updated model could encourage those holdouts to buy a new iPhone. The company said it sold 30 million of the older 4-inch iPhones last year, including the majority of its Chinese sales -- a market where it risks losing share without an updated lower-end option.

“The iPhone SE will improve traction in emerging markets,” said Bill Kreher, a St. Louis-based senior technology analyst at Edward Jones & Co. “Apple needs to better position itself against the plethora of Android-based devices that are available at low price points, and we think they effectively accomplished that here."

FBI Standoff

Earlier, Chief Executive Officer Tim Cook opened the event by wading into the political debate over privacy and encryption. Cook was first to take the stage, and immediately addressed Apple’s legal standoff with the FBI over a court order requiring the company to help the U.S. unlock the handset of a terrorist who killed 14 people in San Bernardino last year. Cook said he’s humbled by the support Apple has received from Americans.

“We did not expect to be in this position, at odds with our own government, but we believe strongly we have a responsibility to help you protect your data and your privacy,” he said. “We will not shrink from this responsibility.”

In a series of filings over the past month, Apple has repeatedly sought to frame the FBI debate as a potential threat to the privacy of hundreds of millions of iPhone users around the world. For its part, the U.S. Justice Department wants to keep the discussion focused on the individual handset that is the subject of the case.

A hearing scheduled Tuesday before a judge in Riverside, California, was canceled after the Justice Department said in a court filing Monday that it may have learned of a way to break into the locked iPhone without the company’s help. The judge ordered the government to file a report on the status of its efforts by April 5.

“We need to decide as a nation how much power the government should have over our data and over our privacy,” Cook said earlier. As he exited the stage at the close of the event, the company’s music choice seemed to underscore his message: speakers played a version of Tom Petty’s song “I Won’t Back Down.”

SE Features

The iPhone SE comes with 16 or 64 gigabytes of storage, with the latter model costing $499. IPhone SE has full support for the Siri voice-enabled digital assistant, a 12-megapixel camera, and includes features found on the larger phones like Apple Pay and the more secure Touch ID fingerprint scanner.

With the SE’s pricing, Apple is “getting serious about gaining more share in the mid-priced smartphone market vs. competitors like Samsung, Huawei, Oppo and LG, as the growth in the premium priced segment is slowing,” said New York-based Bloomberg Intelligence analyst John Butler. “A move to broaden its presence in the mid-priced segment represents Apple’s bid to sustain growth.”

While analysts from UBS Group AG to RBC Capital Markets predict about 15 million annual shipments of Apple’s new handset, introducing the product in the spring may help bolster revenue over the summer, when sales traditionally dip. Apple sold 231 million iPhones in the last fiscal year.

"From a value proposition standpoint, we think it’ll find its niche," Edward Jones’s Kreher said. "At the same time, it’s important to know that Apple’s iPhone 7 update in September will be more critical."

Orders for the new smartphone and iPad begin Thursday, and both will be shipped starting March 31. The company also showed new band styles for Apple Watch, made of woven nylon. Prices for that device will now start at $299, down from $349.

Before the hardware announcements, executives came on stage to emphasize Apple’s corporate responsibility efforts. Lisa Jackson, head of Apple’s environment, policy and social initiatives, unveiled a robot dubbed Liam that disassembles used iPhones in order to recycle components, while Chief Operating Officer Jeff Williams highlighted a new health monitoring and tracking app called CareKit. The tool builds on the existing HealthKit research app.

Smaller Pro

Phil Schiller, Apple’s senior vice president and head of marketing, led the unveiling of the iPad Pro with a 9.7-inch display, a smaller version of the 12.9-inch Pro tablet designed for business users that was first introduced in September. The new Pro will start at $599 for a 32-gigabyte model.

Apple chose to introduce a new 9.7-inch model because “it has remained our most popular size,” Schiller said.

Revenue from Apple’s tablet, introduced in 2010, fell by 21 percent in the three months that ended in December, with existing users seeing no need to buy updated models and more people choosing larger phones instead. The company sold 16.1 million of the devices in the quarter, a 25 percent decline from the holiday quarter a year earlier.

Tablet shipments are forecast to decline 5.9 percent to 195 million units in 2016, according to market researcher IDC. Apple is projected to win 22 percent of the worldwide market in 2020, a decline from 29 percent this year, according to an IDC report earlier this month. Still, Schiller underscored that Apple’s goal with the iPad is winning over users whose PCs are becoming outdated, especially as the handheld devices add more of the larger machines’ functionality.

“There are over 600 million PCs in use today that are over five years old,” Schiller said. “This is really sad.”

Monday, March 21, 2016

How to speed up a folder load in Windows

How to Speed Up a Windows Folder that Loads Very Slowly

There is a curious phenomenon many of you have likely come across: even with a fast computer, there are some folders Windows loads with agonizing slowness. Fortunately the fix is simple and the results are immediate.

Why Your Folders Load So Slowly

There is a long standing Windows Explorer feature that dates all the way back to Windows Vista wherein you can tell Windows Explorer what kind of content is in specific folders, in order to optimize how that content is displayed.
For example: you can tell Windows Explorer that a particular folder is where you store your music files, and it will present those files in a way most useful for browsing music (e.g. in detailed list format with column options like file playtime automatically enabled). Even if you never tell Windows Explorer what to do, it automatically defaults some folders to various settings (the “Music” library folder is, naturally, defaulted to music-type file display) and then uses a feature called Automatic Folder Type Discovery on the rest. The automatic discovery system is a best-guess as to what is in the folder based on the number of files of various types, last files added, and so on.
When it works, it’s a great feature. When it doesn’t work, it’s a rather annoying bug: when a folder with a large number of files is optimized for “pictures”, it immediately churns through all the files in the folder, regardless of whether or not the folder is in thumbnail view, in order to check and refresh all the thumbnails for all the files found therein.
Even on a beefy computer with a modern processor, plenty of RAM, and a speedy solid state drive, this process can take anywhere from 10-15 seconds to in excess of a minute depending on how many files are in the folder. On older computers it can even completely lock up Windows Explorer (not just the folder in question).
A prime example of this agonizingly slow file-churn-bug in action is the Windows “Downloads” folder which, thanks to that whole Automatic Folder Type Discovery feature, is typically set to picture mode on most computers. If we were placing wagers on what brought you to this article, we’d happily wager that you came in search of a solution to your Downloads folder taking minutes to load and display the files. Don’t worry, we won’t judge your cluttered Downloads folder if you don’t judge ours.
Fortunately solving the problem is as simple as telling Windows to stop treating the folder like an image gallery.

How to Change Your Folder Optimizations

As long as you know where to look, it’s easy peasy to change your folder optimizations. First, locate the folder you’re having problems with. Typically most people only have one folder that is particularly sluggish, but if you have a whole host of folders that are misbehaving you can take a top-down approach and change the settings for the parent folder to apply the changes to all the subfolders.
Once you’ve located the folder, simply right-click on either the folder itself in Windows Explorer or, if you have the folder open, on a blank area within the Windows Explorer pane. Select, from the right-click context menu, “Properties”.
Within the Properties menu, select the “Customize” tab.
In the customize tab, you’ll find an entry “Optimize this folder for:” with a drop down menu. The options in the drop down menu are: “General items”, “documents”, “pictures”, “music”, and “videos”. Select “General items”.
If you wish to apply the changes to all the folders within that folder, select “Also apply this template to all subfolders” beneath the drop down menu.
Click “Apply” then “OK” at the bottom of the Properties menu. Back in the troublesome folder, press F5 to reload the folder.
The changes should take place immediately and the dreaded waiting-for-folder-to-load time should be long gone.

Friday, March 18, 2016

US government pushed tech firms to hand over source code

Obtaining a company's source code makes it radically easier to find security flaws and vulnerabilities for surveillance and intelligence-gathering operations.

The US courthouse in Washington DC which houses the secret Foreign Intelligence Surveillance Court, which authorizes the government's surveillance operations. 

NEW YORK -- The US government has made numerous attempts to obtain source code from tech companies in an effort to find security flaws that could be used for surveillance or investigations.

The government has demanded source code in civil cases filed under seal but also by seeking clandestine rulings authorized under the secretive Foreign Intelligence Surveillance Act (FISA), a person with direct knowledge of these demands told ZDNet. We're not naming the person as they relayed information that is likely classified.

With these hearings held in secret and away from the public gaze, the person said that the tech companies hit by these demands are losing "most of the time."

When asked, a spokesperson for the Justice Dept. acknowledged that the department has demanded source code and private encryption keys before. In a recent filing against Apple, the government cited a 2013 case where it won a court order demanding that Lavabit, an encrypted email provider said to have been used by whistleblower Edward Snowden, must turn over its source code and private keys. The Justice Dept. used that same filing to imply it would, in a similar effort, demand Apple's source code and private keys in its ongoing case in an effort to compel the company's help by unlocking an iPhone used by the San Bernardino shooter.

Asked whether the Justice Dept. would demand source code in the future, the spokesperson declined to comment.

It's not uncommon for tech companies to refer to their source code as the "crown jewel" of their business. The highly sensitive code can reveal future products and services. Source code can also be used to find security vulnerabilities and weaknesses that government agencies could use to conduct surveillance or collect evidence as part of ongoing investigations.

Given to a rival or an unauthorized source, the damage can be incalculable.

We contacted more than a dozen tech companies in the Fortune 500. Unsurprisingly, none would say on the record if they had ever received such a request or demand from the government.

Cisco said in an emailed statement: "We have not and we will not hand over source code to any customers, especially governments."

IBM referred to a 2014 statement saying that the company does not provide "software source code or encryption keys to the NSA or any other government agency for the purpose of accessing client data." A spokesperson confirmed that the statement is still valid, but did not comment further on whether source code had been handed over to a government agency for any other reason.

Microsoft, Juniper Networks, and Seagate declined to comment.

Dell and EMC did not comment at the time of publication. Lenovo, Micron, Oracle, Texas Instruments, and Western Digital did not respond to requests for comment. (If this changes, we will provide updates.)

Apple's software chief Craig Federighi said in a sworn court declaration this week alongside the company's latest bid to dismiss the government's claims in the San Bernardino case that Apple has never revealed its source code to any government.

"Apple has also not provided any government with its proprietary iOS source code," wrote Federighi.

"While governmental agencies in various countries, including the United States, perform regulatory reviews of new iPhone releases, all that Apple provides in those circumstances is an unmodified iPhone device," he said.

The declaration was in part to allay fears (and the US government's claims) that it had modified iPhone software to agree to China's security checks, which include turning over source code to its inspectors.

But even senior tech executives may not know if their source code or proprietary technology had been turned over to the government, particularly if the order came from the Foreign Intelligence Surveillance Court (FISC).

The secretive Washington DC-based court, created in 1979 to oversee the government's surveillance warrants, has authorized more than 99 percent of all surveillance requests. The court has broad-sweeping powers to force companies to turn over customer data via clandestine surveillance programs and authorize US intelligence agencies to record an entire foreign country's phone calls, as well as conduct tailored hacking operations on high-value targets.

FISA orders are generally served to a company's general counsel, or a "custodian of records" within the legal department. (Smaller companies that can't afford their own legal departments often outsource their compliance to third-party companies.) These orders are understood to be typically for records or customer data.

These orders are so highly classified that simply acknowledging an order's existence is illegal, even a company's chief executive or members of the board may not be told. Only those who are necessary to execute the order would know, and would be subject to the same secrecy provisions.

Given that Federighi heads the division, it would be almost impossible to keep from him the existence of a FISA order demanding the company's source code.

It would not be the first time that the US government has reportedly used proprietary code and technology from American companies to further its surveillance efforts.

Top secret NSA documents leaked by whistleblower Edward Snowden, reported in German magazine Der Spiegel in late-2013, have suggested some hardware and software makers were compelled to hand over source code to assist in government surveillance.

The NSA's catalog of implants and software backdoors suggest that some companies, including Dell, Huawei, and Juniper -- which was publicly linked to an "unauthorized" backdoor -- had their servers and firewall products targeted and attacked through various exploits. Other exploits were able to infiltrate firmware of hard drives manufactured by Western Digital, Seagate, Maxtor, and Samsung.

Last year, antivirus maker and security firm Kaspersky later found evidence that the NSA had obtained source code from a number of prominent hard drive makers -- a claim the NSA denied -- to quietly install software used to eavesdrop on the majority of the world's computers.

"There is zero chance that someone could rewrite the [hard drive] operating system using public information," said one of the researchers.

Thursday, March 17, 2016

American Express Admits to Theft of Customer Data Three Years Late

American Express Admits to Theft of Customer Data Three Years Late

American Express has warned its customers that they many have had their personal information stolen during a data breach—which happened in 2013.

The company explained to California’s attorney general in a letter sent on March 10th that one of its third-party service providers suffered a data breach. It explains that “account information of some of our Card Members, including some of your account information, may have been involved.”

The breach occurred on Saturday December 7th in 2013. Quite why there was such a huge delay in informing people is unclear—but it is awful form.

But don’t worry! Because American Express reassures everyone by adding that “it is important to note that American Express owned or controlled systems were not compromised by this incident.” Well, thank goodness for that.

The credit card company does say that it’s monitoring accounts for fraud. But given the time lags involved with owning up to the news, you’d probably be best served keeping an eye on your account yourself.

Wednesday, March 16, 2016

Toyota launches new AI lab in US, calls autonomous cars 'robots on wheels'

The biggest car company on earth has created a research center devoted to studying artificial intelligence. Here's what you need to know.
toyota ai

Toyota announces partnership with MIT and Stanford University for AI

This January, inside a temporary lab near MIT, and another at Stanford, a team of researchers is assembled to help Toyota develop artificial intelligence. The creation of the Toyota Research Institute, announced in November 2015, is a 5-year, $1 billion investment devoted to AI—focusing on the development of autonomous car technology and personal-assistant robots.
Gill Pratt, director of the Toyota Research Institute, is based at the Cambridge location—a larger-scale, permanent facility is currently under construction. Pratt, a roboticist by training, previously worked as a program manager for DARPA.
Toyota has "aspirations to be a leader in the field," said Pratt. To that end, they've assembled a team of about two dozen members—while most have experience in computer science and artificial intelligence, others have backgrounds in robotics, cars, or design.
TechRepublic spoke to Pratt about Toyota's plans for the new bi-coastal research lab.

Why MIT?
Since Toyota wants to be a leader in AI, they "wanted to be where the action is," said Pratt. Although the company is based in Japan, it is a global brand, and most of its cars are sold in the US. By putting roots down near MIT, Toyota positioned itself at the center of innovation. "It is, without a doubt, a hotbed of where the kind of work on artificial intelligence, particularly applied to transportation is going on," said Pratt.
Why robots?
Toyota is not the first car company to invest in robots. Many, like Honda, have factory robots. But they are one of the first to invest heavily in home-assistant robots. It's because they're looking to predict what customers will want over the long-term. "What are the needs that human beings are going to have in the next few years?" asked Pratt. Since Toyota is a Japanese company, and demographics are quickly moving to a large percentage of the population being elderly, creating assistant robots will help the elderly "live a dignified life," said Pratt. "We want to focus on mobility for both people and for goods, indoors as well as outdoors."
Why now? What's led us to this peak in interest in self-driving cars?
Several factors have come together to make the current environment ripe for developing self-driving cars. According to Pratt, "technology has opened the door to what's possible." Here are five innovations that have contributed:
Mobile phones: The explosive growth of mobile technology, the low-powered computer processors, the computer vision chips and the cameras, and all the things in the phones have become "incredibly inexpensive and ubiquitous."
Wireless internet: The rise of 4G networks and WiFi have made it easier than ever to connect.
Computer centers in cars: Most new cars right today have a back-up cameras, front and back sensors, and other tech that helps drivers detect objects in the environment. Not only do most cars have these, but the cameras themselves have become better as well.
Maps: If you're talking about either the navigation system you have in your car, said Pratt, or Google maps in your phone, maps have become really good.
Deep learning: Computers now have "perception at levels of competence close to what a human being can do," said Pratt. "The car can look out on the world and tell the difference between a bicycle and a person that's walking, and a tree and a parking meter—all of these things, and can classify them either almost as well as we can, or in some cases, even a little bit better."

Toyota is most concerned about keeping safety as a top priority. Pratt believes that this is the greatest challenge in developing the technology. "We need to be making things work at the level of reliability that is required for our cars to travel safely," said Pratt. He thinks that Toyota and other car manufacturers may have a leg up in this department, over tech companies like Apple and Google. They're used to designing very strictly for safety.
Although Toyota plans to release their own semi-autonomous car by 2020, considering the challenges to ensuring safety, a fully-autonomous vehicle, Pratt believes, is "actually still years off"—unlike Elon Musk, he doesn't see it happening by 2020.

Monday, March 14, 2016

The Incredible Story Of How Hackers Stole $100 Million From The New York Fed

The story of the theft of $100 million from the Bangladesh central bank - by way of the New York Federal Reserve - is getting more fascinating by the day.

As we reported previously, on February 5, Bill Dudley's New York Fed was allegedly “penetrated” when “hackers” (of supposed Chinese origin) stole $100 million from accounts belonging to the Bangladesh central bank. The money was then channeled to the Philippines where it was sold on the black market and funneled to “local casinos” (to quote AFP). After the casino laundering, it was sent back to the same black market FX broker who promptly moved it to “overseas accounts within days.”

That was the fund flow in a nutshell.

As we explained, the whole situation was quite embarrassing for the NY Fed, because what happened is that someone in the Philippines requested $100 million through SWIFT from Bangladesh's FX reserves, and the Fed complied, without any alarm bells going off at the NY Fed's middle or back office.

"Some 250 central banks, governments, and other institutions have foreign accounts at the New York Fed, which is near the centre of the global financial system," Reuters notes. "The accounts hold mostly U.S. Treasuries and agency debt, and requests for funds arrive and are authenticated by a so-called SWIFT network that connects banks."

Well, as it turns out, Bangladesh doesn't agree that the Fed isn't ultimately culpable. "We kept money with the Federal Reserve Bank and irregularities must be with the people who handle the funds there," Finance Minister Abul Maal Abdul Muhith said on Wednesday. “It can’t be that they don’t have any responsibility," he said, incredulous.

Actually, Muhith, the New York Fed under former Goldmanite Bill Dudley taking zero responsibility for enabling domestic and global crime is precisely what it excels at.

But what really happened?

As it turns out there is much more to the story, and as Bloomberg reports today now that this incredible story is finally making the mainstream, there is everything from casinos, to money laundering and ultimately a scheme to steal $1 billion from the Bangladeshi central bank.  In fact, the story is shaping up to be "one of the biggest documented cases of potential money laundering in the Philippines. It risks setting back the Southeast Asian nation’s efforts to stamp out the use of the country to clean cash, and tarnishing the legacy of President Benigno Aquino as elections loom in May."

And yes, it does appear that hackers managed to bypass the Fed's firewall:

“Even as banks continue to harden their defenses against such sabotage, hackers too have upped their game to breach servers by utilizing both technical skills and rogue elements within the financial institutions,” said Sameer Patil, an associate fellow at Gateway House in Mumbai who specializes in terrorism and national security.

* * *

The story begins in Bangladesh, a country of about 170 million people that’s recently found itself with record foreign reserves thanks to a low wage-fueled export boom and inward remittances. Some of those reserves were held in an account at the Federal Reserve Bank of New York.

Finance Minister Abul Maal Abdul Muhith this week accused the Fed of “irregularities” that led to the unauthorized transfer of $100 million from the account. The Bangladesh central bank said the funds had been stolen by hackers and that some had been traced to the Philippines.

As reported previously, a Bangladesh central bank official who is part of a panel investigating the disappearance of the funds said Wednesday that a separate transfer of $870 million had been blocked by the Fed, something the Fed refused to comment on. It does not, however, explain why $100 million was released.

Essentially the dispute is about whether the Fed went through the right procedure when it received transfer orders.

Naturally, the Fed's story is that it did nothing wrong. Bloomberg writes that according to a Fed spokeswoman, instructions to make the payments from the central bank’s account followed protocol and were authenticated by the SWIFT codes system. There were no signs the Fed’s systems were hacked, she said.

The problem is that the counterparty on the other side of the SWIFT order was not who the Fed thought, and what should have set off red lights is that the recipients was not the government of the Philippines but three casinos!

On the other hand, Bangladesh is quite - understandably - furious: a local official said the Fed should’ve checked the payment orders with the central bank to ensure they were authentic, even if they used the correct SWIFT codes. The official also said there are plans to take legal action against the Fed to retrieve missing funds.

Aquino spokesman Sonny Coloma said he had no information on reports that funds from the Bangladesh central bank reached the Philippines. The case is being handled by the AMLC, an independent body, Coloma said. Bangko Sentral ng Pilipinas Governor Amando Tetangco, who heads the AMLC, did not reply to mobile-phone messages seeking comment.

If at this point flashing light bulbs are going off above the heads of some of our more industrious readers, we can understand why: after all if a fake SWIFT money order is all it takes to have the Fed send you $100 million dollars then...

Separately, a Reuters report digs into the details of the SWIFT wire requests: it notes that the hackers breached Bangladesh Bank's systems and stole its credentials for payment transfers, two senior officials at the bank said. They then bombarded the Federal Reserve Bank of New York with nearly three dozen requests to move money from the Bangladesh Bank's account there to entities in the Philippines and Sri Lanka, entities which as will be revealed shortly were... casinos.

Four requests to transfer a total of about $81 million to the Philippines went through, but a fifth, for $20 million, to a Sri Lankan non-profit organization was held up because the hackers misspelled the name of the NGO, Shalika Foundation.

Hackers misspelled "foundation" in the NGO's name as "fandation", prompting a routing bank, Deutsche Bank, to seek clarification from the Bangladesh central bank, which stopped the transaction, one of the officials said.

There is no NGO under the name of Shalika Foundation in the list of registered Sri Lankan non-profits. Reuters could not immediately find contact information for the organization.

Luckily, the Fed stopped some of the $1 billion in total requested funds. The unusually high number of payment instructions and the transfer requests to private entities - as opposed to other banks - raised suspicions at the Fed, which also alerted the Bangladeshis, the officials said. The details of how the hacking came to light and was stopped before it did more damage have not been previously reported. Bangladesh Bank has billions of dollars in a current account with the Fed, which it uses for international settlements.

The transactions that were stopped totaled $850-$870 million, one of the officials said. At least$80 million made it through without a glitch.

* * *

Meanwhile, back in the Philippines, the gaming regulator said it is investigating reports that as much as $100 million in suspicious funds were remitted to the bank accounts of three casinos it didn’t identify.

The Philippine Daily Inquirer has led reporting on the theft. It wrote last month that cash may have entered the Philippines via the Jupiter Street, Makati City, branch of Rizal Commercial Banking Corp. The money was converted into pesos and deposited in the account of an unidentified Chinese-Filipino businessman who runs a business flying high net worth gamblers to the Philippines.

The funds were used to buy casino chips or pay for losses at venues including Bloomberry Resorts Corp.’s Solaire Resort & Casino and Melco Crown Philippines Resort Corp.’s City of Dreams Manila, according to the paper. There was no suggestion in the report the banks or casinos named were complicit with any improper movement of funds.

In other words, the Fed was funding gamblers, only these were located in Philippine casinos, not in the financial district. Ironically, that's precisely what the Fed does, only it normally operates with gamblers operating out of Manhattan's financial district.

Bloomberry Resorts investor relations director Leo Venezuela and City of Dreams Manila Vice President Charisse Chuidian didn’t reply to calls and phone messages.

And then, once the "gamblers" were done having their fun laundering freshly received Fed money, they moved the cash offshore: funds were later dispatched into accounts outside the Philippines, the paper said, including to Hong Kong. The Hong Kong Monetary Authority declined to comment, as did the Hong Kong police. The Inquirer separately reported the head of the Rizal branch where the transactions occurred had made a statement that top bank officials were aware of the transactions “at every stage."

Were the banks in on this unprecedented theft? Probably, although it will be nearly impossible to prove.

Rizal’s shareholders “are fully committed to comply with all banking laws and regulations, in particular those on money laundering,” Vice Chairman Cesar E.A. Virata said in a statement Wednesday. In a separate statement, the bank’s Chief Executive Officer Lorenzo Tan condemned “any insinuations that the top management of the bank knew of and tolerated alleged money laundering activities in one branch.”

* * *

The exact amount stolen from Bangladesh is still not exactly clear, as is what happens next in the dispute with the Fed.

While Muhith said the Fed was responsible for at least $100 million, another Bangladeshi central bank official who asked not to be identified said $20 million of a $101 million total had been recovered from an account held in Sri Lanka, leaving $81 million unaccounted for. That figure matches the amount Rizal’s Virata said the bank was investigating.

What we would like to know, is whether this is merely the Fed's way of testing its level of preparedness for the moment it has to wire helicopter money around the globe, in lieu of using drone delivery of cash, especially if cash has been banned previously as so many "famous economists" demand, clearly unaware that cash has to be present when in the last ditch step to boost inflation, the Fed has no choice but to hand out physical money to every willing recipient.

For a few lucky recipients in the Philippines, it already worked out.